DoD Awards Leidos $5.2M for Cisco Network Coverage, Raising Value Concerns
Contract Overview
Contract Amount: $5,246,162 ($5.2M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2024-09-27
End Date: 2026-02-24
Contract Duration: 515 days
Daily Burn Rate: $10.2K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: 1-YEAR 100% CISCO SNT AND SWSS COVERAGE
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $5.2 million to LEIDOS, INC. for work described as: 1-YEAR 100% CISCO SNT AND SWSS COVERAGE Key points: 1. Contract value is moderate at $5.2M. 2. Leidos, Inc. is the sole awardee. 3. Potential risk in single vendor reliance for critical network coverage. 4. Spending falls within the IT sector.
Value Assessment
Rating: questionable
The contract value of $5.2M for 1-year coverage of Cisco SNT and SWSS appears high for a single vendor solution. Benchmarking against similar network maintenance contracts is crucial to determine if this pricing is competitive.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Although advertised as full and open competition, the award to a single entity suggests potential limitations in the bidding process or a lack of competitive offers. This could impact price discovery and potentially lead to higher costs.
Taxpayer Impact: Taxpayer funds may be at risk of being overspent if the competition did not yield the lowest possible price for this essential network coverage.
Public Impact
Ensures continuity of critical Cisco network services for the Department of the Navy. Potential for vendor lock-in if alternatives are not explored. Supports IT infrastructure essential for military operations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of demonstrated competition despite 'full and open' status.
- Reliance on a single vendor for critical network infrastructure.
- Potential for price escalation in future renewals.
Positive Signals
- Provides essential network coverage, ensuring operational continuity.
- Firm fixed price contract limits cost overruns.
Sector Analysis
This contract falls under the Information Technology sector, specifically focusing on network hardware maintenance and support. Spending benchmarks for similar Cisco support contracts vary widely based on scope and duration, but $5.2M for one year warrants scrutiny.
Small Business Impact
The data indicates this contract was not awarded to a small business. Further analysis would be needed to determine if small businesses had opportunities to participate in this procurement.
Oversight & Accountability
The 'full and open competition' designation requires careful review to ensure genuine market engagement and fair pricing. Oversight should focus on the justification for a single awardee and future competitive strategies.
Related Government Programs
- Telephone Apparatus Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Potential lack of true competition.
- Single vendor dependency.
- High contract value for annual support.
- Limited visibility into specific service components.
Tags
telephone-apparatus-manufacturing, department-of-defense, va, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $5.2 million to LEIDOS, INC.. 1-YEAR 100% CISCO SNT AND SWSS COVERAGE
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $5.2 million.
What is the period of performance?
Start: 2024-09-27. End: 2026-02-24.
What specific factors led to only one awardee being selected under a 'full and open competition' solicitation for this Cisco network coverage?
The solicitation may have had highly specific technical requirements that only Leidos, Inc. could meet, or the market research may have been insufficient to identify other capable vendors. Alternatively, the pricing structure or terms might have deterred other potential bidders. A thorough review of the solicitation documents and award justification is necessary to understand the precise reasons.
What is the risk associated with relying solely on Leidos, Inc. for critical Cisco network support over the contract duration?
The primary risk is vendor lock-in, which can limit future negotiation leverage and potentially lead to price increases upon renewal. It also concentrates operational risk; if Leidos faces performance issues or financial instability, the Navy's network could be severely impacted without readily available alternatives. This single-source dependency reduces overall system resilience.
How does the $5.2M award compare to industry benchmarks for similar Cisco network support contracts, and what is the potential taxpayer impact?
Without specific details on the scope of 'SNT and SWSS coverage,' direct benchmarking is difficult. However, $5.2M for a single year of support for network hardware is substantial. If this price exceeds competitive market rates, taxpayers could be overpaying, potentially by hundreds of thousands or even millions of dollars over the contract's life, depending on future renewals and scope adjustments.
Industry Classification
NAICS: Manufacturing › Communications Equipment Manufacturing › Telephone Apparatus Manufacturing
Product/Service Code: IT AND TELECOM - NETWORK
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N0003924R9502
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 11951 FREEDOM DR, RESTON, VA, 20190
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $5,386,259
Exercised Options: $5,246,162
Current Obligation: $5,246,162
Subaward Activity
Number of Subawards: 17
Total Subaward Amount: $3,618,689
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0003917D0007
IDV Type: IDC
Timeline
Start Date: 2024-09-27
Current End Date: 2026-02-24
Potential End Date: 2026-02-24 00:00:00
Last Modified: 2025-12-08
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